Goucher, Jr. et al v. Colvin
Filing
38
ORDER Granting in Part and Denying in Part 33 Plaintiff's Counsel's Motion for Award of Attorney's Fees. Signed by Judge Edward M. Chen on 8/9/2017. (emcsec, COURT STAFF) (Filed on 8/9/2017)
1
2
3
4
UNITED STATES DISTRICT COURT
5
NORTHERN DISTRICT OF CALIFORNIA
6
JERRY D. GOUCHER, JR.,
7
Plaintiff,
8
v.
9
10
CAROLYN W. COLVIN,
11
Defendant.
ORDER GRANTING IN PART AND
DENYING IN PART PLAINTIFF’S
COUNSEL’S MOTION FOR AWARD
OF ATTORNEY’S FEES
Docket No. 33
12
For the Northern District of California
United States District Court
Case No. 14-cv-03009-EMC
Plaintiff Jerry D. Goucher, Jr. initiated this social security case in 2014. In July 2015, the
13
14
Court granted Mr. Goucher‟s motion for summary judgment and denied the government‟s. On
15
remand to the Social Security Administration (“SSA”), Mr. Goucher prevailed and was awarded
16
disability benefits, including but not limited to past-due benefits.
Currently pending before the Court is a motion filed by Mr. Goucher‟s law firm, Sackett &
17
18
Associates (“Sackett”), in which it seeks attorney‟s fees pursuant to 42 U.S.C. § 406(b). Sackett
19
acknowledges that any award under § 406(b) would be offset by the $6,000 EAJA award that the
20
Court previously awarded pursuant to stipulation between the parties (i.e., Sackett would get the §
21
406(b) fee award and Mr. Goucher would get the $6,000 EAJA fee award).1 See Docket Nos. 31-
22
32 (stipulation and order regarding EAJA fees).
Because, ultimately, any § 406(b) fee award will be paid out of Mr. Goucher‟s pocket,
23
24
25
26
27
28
1
See Gisbrecht v. Barnhart, 535 U.S. 789, 796 (2002) (“Congress harmonized fees payable by the
Government under EAJA with fees payable under § 406(b) out of the claimant’s past-due Social
Security benefits in this manner: Fee awards may be made under both prescriptions, but the
claimant‟s attorney must „refund to the claimant the amount of the smaller fee.‟ „Thus, an EAJA
award offsets an award under Section 406(b), so that the [amount of the total past-due benefits the
claimant actually receives] will be increased by the . . . EAJA award up to the point the claimant
receives 100 percent of the past-due benefits.‟”) (emphasis added).
1
Sackett served a copy of the fee motion on Mr. Goucher. See Docket No. 33-2 (proof of service).
2
Mr. Goucher has not filed any opposition to Sackett‟s fee request. The government has filed a
3
response in which it states that, as a formal matter, it “takes no position on the reasonableness of
4
the [fee] request.” Resp. at 5.
5
Shortly before the hearing on the matter, Sackett asked the Court to rule on its motion for
6
fees without oral argument. The Court granted that request and now GRANTS in part and
7
DENIES in part Sackett‟s motion for fees.
8
I.
9
FACTUAL & PROCEDURAL BACKGROUND
As indicated above, Mr. Goucher prevailed in his lawsuit against the SSA, obtaining an
Mr. Goucher prevailed again and was found disabled. See Ex. A (ALJ decision, dated May 17,
12
For the Northern District of California
order from this Court remanding to the agency for further proceedings. On remand to the agency,
11
United States District Court
10
2017) (stating that, “[b]ased on the application for a period of disability and disability insurance
13
benefits protectively filed on May 9, 2011, the claimant has been disabled under sections 216(i)
14
and 223(d) of the Social Security Act beginning on November 1, 2011”).
15
Mr. Goucher was awarded, inter alia, past-due benefits. Sackett represents that the amount
16
of past-due benefits awarded was $100,649. See Ex. B (notice of award) (providing that “you are
17
entitled to monthly disability benefits from Social Security beginning April 2012”; showing the
18
monthly benefit amount, with periodic adjustments for cost of living). Neither Mr. Goucher nor
19
the government contests the amount of past-due benefits.
20
21
22
23
24
25
26
27
28
Mr. Goucher and Sackett had a fee agreement which provided, in relevant part as follows:
IF I RECEIVE A FAVORABLE DECISION AT ANY TIME
FOLLOWING AN UNFAVORABLE OR PARTIALLY
FAVORABLE DECISION EITHER AT ANY ADMINISTRATIVE
LEVEL OR AT THE JUDICIAL LEVEL:
I will pay SACKETT . . . , subject to the approval of the Social
Security Administration for representation at the administrative
level, and by the district or circuit court for representation at the
judicial level, a fee no greater than 25% of the past-due benefits
owed to me . . . .
Ex. C (Fee Agmt. at 1).
Here, as noted above, past-due benefits amounted to $100,649. Twenty-five percent of the
2
1
past-due benefits is $25,162.25, which is the amount of the fee request now being made by
2
Sackett. See also Ex. B (notice of award) (stating that, “[b]ased on the law, we must withhold part
3
of past-due benefits of pay an appointed representative[;] [w]e cannot withhold more than 25% of
4
past-due benefits to pay an authorized fee” and, here, “[w]e withheld $25,162.25”). Sackett notes
5
that, although this is the gross fee being requested, “[Mr.] Goucher would be credited for
6
$6,000.00” because of the EAJA fee award; “[t]his would result in [Mr. Goucher] paying Sackett a
7
net fee . . . for $19,162.25.” Mot. at 2.
Sackett represents that it incurred 30.90 attorney hours litigating Mr. Goucher‟s case
8
9
before this Court. See Ex. E (itemization of services rendered). Thus, if the Court awards the full
fee request, Sackett would be paid a de facto hourly rate of $814.31 (i.e., $25,162.25 ÷ 30.9
11
hours).2
II.
12
For the Northern District of California
United States District Court
10
Sackett‟s fee request of $25,162.25 is made pursuant to § 406(b). Section 406(b) provides
13
14
in relevant part as follows:
15
Whenever a court renders a judgment favorable to a claimant under
this title [ 42 U.S.C. § 401 et seq.] who was represented before the
court by an attorney, the court may determine and allow as part of
its judgment a reasonable fee for such representation, not in excess
of 25 percent of the total of the past-due benefits to which the
claimant is entitled by reason of such judgment . . . .
16
17
18
19
42 U.S.C. § 406(b)(1)(A).
In Gisbrecht, 535 U.S. at 789, the Supreme Court addressed an issue that had “sharply
20
21
DISCUSSION
divided” the circuit courts with respect to § 406(b) – i.e.,
22
[w]hat is the appropriate starting point for judicial determinations of
a “reasonable fee for [representation before the court”]? Is the
contingent-fee agreement between claimant and counsel, if not in
excess of 25% of past-due benefits, presumptively reasonable? Or
should courts being with a lodestar calculation . . . of the kind we
have approved under statutes that shift the obligation to pay to the
loser in the litigation?
23
24
25
26
27
28
2
It appears that Sackett‟s paralegal spent another 4.95 hours on the case. See Ex. E (itemization
of services rendered). However, Sackett does not count these hours toward its request for fees,
and therefore the Court shall not either.
3
1
2
Id. at 793.
The Supreme Court held that Congress “designed § 406(b) to control, not to displace, fee
3
agreements between Social Security benefits claimants and their counsel,” and, because the lower
4
court had rested its review on “lodestar calculations” and “reject[ed] the primacy of lawful
5
attorney-client fee agreements,” the Court reversed the judgment below. Id.
6
7
8
9
10
12
For the Northern District of California
United States District Court
11
13
14
15
16
17
18
19
20
21
22
The Court went on to explain that
§ 406(b) does not displace contingent-fee agreements as the primary
means by which fees are set for successfully representing Social
Security benefits claimants in court. Rather, § 406(b) calls for court
review of such arrangements as an independent check, to assure that
they yield reasonable results in particular cases. Congress has
provided one boundary line: Agreements are unenforceable to the
extent that they provide for fees exceeding 25 percent of the pastdue benefits. Within the 25 percent boundary, . . . the attorney for
the successful claimant must show that the fee sought is reasonable
for the services rendered.
Id. at 807 (emphasis added).
The Supreme Court acknowledged that courts
have appropriately reduced the attorney‟s recovery based on the
character of the representation and the results the representative
achieved. If the attorney is responsible for delay, for example, a
reduction is in order so that the attorney will not profit from the
accumulation of benefits during the pendency of the case in court. If
the benefits are large in comparison to the amount of time counsel
spent on the case, a downward adjustment is similarly in order. In
this regard, the court may require the claimant‟s attorney to
submit . . . as an aid to the court‟s assessment of the reasonableness
of the fee yielded by the fee agreement[,] a record of the hours spent
representing the claimant and a statement of the lawyer‟s normal
hourly billing charge for noncontingent-fee cases.
Id. at 808 (emphasis added).
23
In the instant case, Sackett is not asking for fees that constitute more than 25 percent of
24
Mr. Goucher‟s past-due benefits. That being the case, the question for the Court is whether the
25
full 25 percent of the past-due benefits is reasonable under the circumstances. And here, the
26
Court‟s main concern is whether there should be a downward adjustment in fees because the past-
27
due benefits (over $100,000) are large compared to the amount of time Sackett spent on the case
28
(about 31 hours). As noted above, the de facto hourly rate under these facts is about $814. This is
4
1
a high hourly rate, particularly in a Social Security case.
$800 has been approved in some Social Security cases. See Mot. at 10 n.53 (citing cases). But
4
none of the cases cited by Sackett involves Sackett or is a Northern District of California case.
5
Furthermore, while Sackett does cite to one Ninth Circuit opinion (where the fee awards translated
6
to de facto hourly rates of $519, $875, and $902), see Crawford v. Astrue, 586 F.3d 1142, 1153
7
(9th Cir. 2009) (Clifton, J., dissenting), Sackett has failed to demonstrate with any specificity how
8
Crawford – or any of the district court cases it has cited – are similar or analogous to the instant
9
case, thus warranting a similar de facto hourly rate. See id. (majority opinion) (stating that a
10
“district court should look at the complexity and risk involved in the specific case at issue to
11
determine how much risk the firm assumed in taking the case”). In addition, Crawford is
12
For the Northern District of California
In defense of the fee request, Sackett points out that a de facto hourly rate of more than
3
United States District Court
2
distinguishable because, there, counsel actually reduced their fees “substantially from the
13
allowable 25%.”3 Id. at 1152.
Sackett‟s other arguments in defense of a $814 de facto hourly rate are not persuasive. For
14
15
example, even assuming that Sackett‟s noncontingent hourly rate is $350-400,4 the Court is not
16
persuaded that the risk associated with this specific case justifies a multiplier of 2. Although
17
Sackett claims that Mr. Goucher‟s case in particular involved a significant risk of loss, there are no
18
concrete facts to back up that claim. Sackett‟s argument is largely generic and generalized. See
19
Mot. at 9.
20
3
21
22
23
24
25
26
27
28
The same is true with respect to several of the district court cases cited by Sackett. See, e.g.,
Knudsen v. Colvin, No. CV 11-05093-JEM, 2015 WL 4205319, at *2 (C.D. Cal. July 10, 2015) (in
case where de facto hourly rate was $973.78, noting that the fee award “requested is
approximately 20% of Plaintiff's benefits which is less than the 25 percent cap imposed by §
406(b)”); Quinnin v. Colvin, No. 1:12-CV-01133-SI, 2013 WL 5786988, at *1, 4 (D. Or. Oct. 28,
2013) (in case where counsel asked for 22 percent of past-due benefits, ultimately awarding only
15 percent, resulting in a de facto hourly rate of $1,240); Ali v. Comm'r, Soc. Sec. Admin., No.
3:10-CV-01232-CL, 2013 WL 3819867, at *3 (D. Or. July 21, 2013) (in case where de facto
hourly rate was $1,000, noting that “[c]ounsel has already adjusted downward the percentage of
fees he seeks from those provided for in the valid contingent-fee agreement, from 25 percent to 14
percent”); Daniel v. Astrue, No. EDCV 04-01188-MAN, 2009 WL 1941632, at *2 (C.D. Cal. July
2, 2009) (noting that, “[a]lthough the de facto hourly rate of plaintiff's counsel's services amounts
to $1,491.25,4 counsel seeks only approximately 18% of plaintiff's past-due benefits, rather than
the 25% to which counsel is entitled under the Agreement”).
4
There is no supporting declaration from Sackett to support this claimed noncontingent rate.
5
Implicitly recognizing such, Sackett contends that the de facto hourly rate should really be
1
principled reason to exclude the EAJA credit. See, e.g., Stewart v. Astrue, No. C 05-2317 PVT,
4
2010 U.S. Dist. LEXIS 35936, at *3 (N.D. Cal. Mar. 15, 2010) (“Plaintiff's counsel‟s suggestion
5
that the court should base its reasonableness determination on just $ 11,765.89 of the award [i.e.,
6
taking out the EAJA award] ignores the reality of how much money he will actually have received
7
for the court case.”). Furthermore, even if the Court were to assume a de facto hourly rate of
8
$620, that would not automatically make the rate reasonable. Although Sackett cites a chart
9
indicating that a Bay Area lawyer with more than 30 years of experience can charge $630 per hour
10
as a noncontingent rate, see Mot. at 11 & Ex. F (chart), the $630 hourly rate is commanded by the
11
top ninth decile only and it is not clear that Sackett falls into that group. The average
12
For the Northern District of California
$620 “after the credit [Mr.] Goucher [gets] for EAJA fees,” Mot. at 10; however, there is no
3
United States District Court
2
noncontingent hourly rate is only $480.
Another consideration for the Court is whether Sackett has ever actually been awarded a de
13
14
facto hourly rate in the $814 neighborhood. The Court was not able to locate any such case; nor
15
has Sackett cited to any such case. There were two cases (from 2010 and 2006) where Sackett
16
was awarded a de facto hourly rate in the $600 range5 but most cases (from 2003 through 2016)
17
were in the $300-400 range.6
18
Taking into account all of the above, the Court finds that Sackett has failed to show that,
19
“[w]ithin the 25 boundary” permitted by § 406(b), “the fee sought is reasonable for the services
20
rendered.” Gisbrecht, 535 U.S. at 807. Instead of a de facto hourly rate of $814, the Court
21
concludes that a de facto hourly rate of $600 is reasonable. This sum constitutes a multiplier of
22
5
23
24
See Stewart, 2010 U.S. Dist. LEXIS 35936, at *3-4 (de facto hourly rate of $600); Jakob v.
Barnhart, No. C 00-20763 JF, 2006 U.S. Dist. LEXIS 93679, at *4 (N.D. Cal. Dec. 14, 2006) (de
facto hourly rate of $603.28).
6
25
26
27
28
See, e.g., Conner v. Colvin, No. 13-cv-03324-KAW, 2016 U.S. Dist. LEXIS 137188, at *7-8
(N.D. Cal. Oct. 3, 2016) (de facto hourly rate of $360.32); Zutis v. Colvin, No. C 12-01897 WHA,
2015 U.S. Dist. LEXIS 77979, at *4-5 (N.D. Cal. June 16, 2015) (de facto hourly rate of $320.30);
Sizelove v. Astrue, No. 5:05-cv-04533 JF, 2012 U.S. Dist. LEXIS 120735, at *4 (N.D. Cal. Aug.
24, 2012) (de facto hourly rate of $407.64); Lopez v. Astrue, No. C 07-02649 PJH, 2011 U.S. Dist.
LEXIS 7448, at *9 (N.D. Cal. Jan. 20, 2011) (de facto hourly rate of $441.79); Panzica v. Comm’r
of Soc. Sec., No. C 06-6476, 2010 U.S. Dist. LEXIS 28254, at *4 (N.D. Cal. Mar. 16, 2010) (de
facto hourly rate of $330).
6
1
1.5 assuming a noncontingent hourly rate of $400. This is a fair multiplier that accounts for the
2
risk to Sackett in taking on Mr. Goucher‟s specific case, including but not limited to the specific
3
medical impairments Mr. Goucher had and treatment therefor.
4
5
With a de facto hourly rate of $600 and 30.9 hours, the attorney‟s fee award to be paid out
of Mr. Goucher‟s past-due benefits is $18,540.
III.
6
CONCLUSOIN
7
For the foregoing reasons, the Court grants in part and denies in part Sackett‟s motion for
8
attorney‟s fees. The Court awards $18,540 as § 406(b) attorney‟s fees. The $6,000 EAJA award
9
shall be refunded to Mr. Goucher.
10
This order disposes of Docket No. 33.
12
For the Northern District of California
United States District Court
11
IT IS SO ORDERED.
13
14
15
16
Dated: August 9, 2017
______________________________________
EDWARD M. CHEN
United States District Judge
17
18
19
20
21
22
23
24
25
26
27
28
7
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?